TPO’s 20% Fantasy Margin Rejected – ITAT Removes Wrong Comparables Orders Fresh TP Computation

Assimilate Solutions India Private Limited Vs DCIT/ACIT (ITAT Delhi) Assimilate Solutions India Pvt. Ltd., an IT-enabled service provider to its US AE, applied TNMM & showed a margin of 12.53%, which was within the arm’s length range of its selected comparables. TPO accepted TNMM but altered the comparable set—he rejected one of Assessee’s comparables, added nine new ones, ignored the contractual cost-plus range of 5–25%, & assumed a flat 20% margin. He computed a median margin of 19.69% & proposed a large TP adjustment, later reduced by DRP to 18.55%. Assessee argued that ...